Simon Coveney (Cork South Central, Fine Gael) | Oireachtas source

There were a lot of questions, as I would expect from Deputy Bruton. I know Deputy Bruton has done quite a lot of work on the circular economy, as has Fine Gael. I will let him know in practical terms what is being done. First, there is a second iteration of a Government strategy being prepared on the circular economy by the Department of the Environment, Climate and Communications. My Department is supporting that work, engaging on it and dealing with many of the areas the Deputy mentioned such as waste avoidance and recovery. The Deputy made a significant contribution on this when he was in the Department as regards putting real structure on Ireland's approach to the climate challenge. In the next few days we will see the first auction for the generation of offshore wind materialise and we are effectively starting to see the start of a new era of energy. It will take time, but certainly in the context of sustainable growth, if I am speaking to the IDA in a few years' time, the pitch for Ireland will be what it is today, plus a much stronger competitive narrative with respect to access to large amounts of clean energy. That will be driven predominantly by wind, both on and offshore, but it will also include solar energy. For the first time ever last week, 10% of Ireland's electricity needs were provided by solar energy. It was the first time it was in double digits and that will continue to grow. We are making progress in this area. With respect to certain sectors of the economy, my Department is pushing hard to try to promote modern methods of construction, which are far more efficient, should be more cost effective and certainly more sustainable as regards energy management. A much higher percentage of homes will be built off-site and constructed more quickly in the future, which will guarantee higher energy ratings and so on. There is more to do in this space. We are coming from behind in respect of some of the measurements although the percentage contribution from wind last year was close to 35% of the grid. We have set a target that 80% of our electricity generation will be renewable by 2030.

I think we can get there. Beyond 2030, we will be producing multiples of what our electricity grid currently demands but, of course, our energy use is not just about current electricity demand. It is also about transport fleets, etc. This week I had a really interesting meeting with Gas Networks Ireland. It spoke about how it is ensuring that its infrastructure is suitable for the transport of hydrogen around our economy, as well as gas and biogas. We are now seeing State companies and the private sector planning for a very different kind of future, which is much more in line with the Deputy’s vision for a circular economy in terms of how we manage waste and recycle it for further use or generate energy from it, how we effectively reposition current infrastructure, like, for example, pipeline infrastructure, to be able to carry the fuels of the future, such as hydrogen, and, of course, how we harvest and generate hydrogen through renewable sources, such as offshore wind. This is a really attractive new economy that we are planning for at the moment. The challenges are with licensing systems and auction rounds, as well as with trying to do it at a pace that can compete with our competitors, who are ahead of us in this space.

However, anybody who suggests that Ireland is not currently planning for an energy revolution does not really understand what is happening in government. While I think everyone in this committee understands what is happening, we perhaps also need to communicate that outside of these rooms.

On the questions about the role of local enterprise offices, LEOs, I think Deputy Bruton is right on this. At the end of last year, we effectively changed the remit of LEOs. As the Deputy will know, before that, they could only deal with a certain category of company, as well as companies that employed fewer than ten people. This was a pretty narrow cohort of businesses. We have now extended that to fewer than 50 people, which in my view dramatically changes the role of local enterprise offices. We have increased the resources for local enterprise offices in response to that increased demand. However, there is more work to do here. If you are a company that goes to a LEO office looking for specific expertise, in all likelihood you will probably get a grant or a voucher to source that expertise from the private sector. That is how the model generally works. We are thinking at the moment about how perhaps we could create centres of expertise in some LEO offices that could become national centres expertise in certain areas and, of course, about how we can tap into expertise within Enterprise Ireland that could potentially be used by LEO offices as well. Yet, there is a bit of work to be done on that. At the moment, we have a good support structure in place for small businesses and Enterprise Ireland is also doing a really good job but that does not mean we cannot improve it. That may be through vouchers and grants to allow companies to get the specialist support they need either from academia or from private sector consultants. Maybe we should be providing that expertise within centres of excellence in certain LEOs to provide that role. That is something that we are going to look at in the months ahead.

In terms of pricing levels, there is a big focus on retail today, and rightly so because consumers are sore at the moment when they look at their grocery bills at the end of each week. We still essentially have price inflation in the food retail sector of close to 13%, but inflation more generally is now down to approximately 6%. I think that is an issue that needs to be addressed by the Government. That is why the retail forum is meeting today. It is important, though, to say a few things more broadly. If you look at EUROSTAT figures, competition in the food retail space in Ireland has been working quite well. In fact, according to EUROSTAT, Ireland has the second lowest inflation rate in terms of food inflation since 2015 within the European Union. Therefore, not all is broken here. Having said that, it is really the last number of months that we have a concern about. We need to make sure that competition in food retail is working as it should and that consumers are getting a fair deal. Everybody understands the dramatic impact of the war in Ukraine has had on inflation, but the reality is that inflation is now reducing quite significantly and it will continue to do so throughout the year. That means effectively that the cost of producing food should be falling and the cost of supply chains should also be falling. We need to see that reflected in consumer prices within retail outlets. The Government will continue to focus on this until we get an outcome that we see as both transparent and fair for consumers.

The Deputy asked broader questions around costs generally, such as banking margins and profits in banking versus the competitiveness of the rates that are on offer. The issue of access to funds for the small business sector was raised earlier by some colleagues, and it is an issue. I will take away the suggestion the Deputy made in terms of whether we could call on multiple arms of the State, such as the Central Bank or Financial Services and Pensions Ombudsman, to maybe look at how we could be more impactful by making sure that funding in Ireland is as competitive as it needs to be given how globalised our market is, as well as how we are compared with other sites across the European Union all the time.